Taxation and Customs Union

Rules of Origin

Rules of origin determine where goods originate, i.e. not where they have been shipped from, but where they have been produced or manufactured. As such, the ‘origin’ is the 'economic nationality' of goods traded in commerce. The tariff classification, value and origin of a good are determining factors based on which the customs tariff treatment is applied. For customs matters, there is a distinction between two types of origins, notably non-preferential origin and preferential origin.

Non-preferential origin

Non-preferential rules of origin are used to determine the country of origin of goods for the application of the most-favoured nation treatment (MFN) but also for the implementation of a number of commercial policy measures such as anti-dumping and countervailing duties, trade embargoes, safeguard measures and quantitative restrictions or tariff quotas. They are also used for trade statistics, public tenders and origin marking. The EU applies its own set of non-preferential rules of origin provisions, which may be different from those of any other third country.

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Preferential Origin

Preferential rules of origin determine whether goods qualify as originating from certain countries, for which special arrangements and agreements apply. Where all the requirements are met, goods with preferential origin are eligible to be imported with lower duty rates or at zero rate, depending on the preferential tariff treatment provided for.

Read more on Preferential Origin.

Binding origin information

BOIs are decisions by the competent authorities, which are binding on the holder and on the customs authorities in all Member States in respect of goods imported or exported after their issue, provided the goods and the circumstances determining the acquisition of origin are identical in every respect to what is described in the BOI. The BOI decisions are normally valid for three years from the date of issue. It is to be noted that the holder of a BOI is not exempted from presenting the necessary proof of origin in order to be granted a preferential duty rate. In the international context BOI decisions are referred to as advance rulings on origin.

More information is to be found in the Guidance on Binding Origin Information.